Climate News of the Week Roundup: Fossil Fuel Subsidies Run Rampant

This week’s roundup includes allegations that the EU’s DG Energy removed figures from a report that showed that renewables get only a fraction of the subsidies nuclear and fossil fuels are getting in the EU, another report showing the same picture for the global level, Chile doubling its renewable electricity target, solar continuing strong in Japan, reports of falling wind and solar costs, Germany blowing up an already done EU deal on car emission standards, Merkel cautiously coming out in favour of doing something about the EU ETS crisis, the announcement of Germany’s renewables surcharge for 2014, and more.

Oettinger sugarcoated subsidy report. Cerstin Gammelin reports (in German) that figures on EU-wide energy subsidies got excised from a DG Energy report. The internal draft she obtained put EU-wide subsidies for renewables at 30 billion euros per year, subsidies for nuclear at 35 billion and for fossil fuels at 26 billion. In addition, fossil fuel use was noted to cause 40 billion in health damages annually. Gammelin posits that the figures were removed since Energy Commissioner Oettinger is rather against renewables and likes to take the line that subsidies are too high and need to be reduced.

Fossil energy: The subsidy madness is unbroken. Marlies Uken reports (in German) that global fossil fuel subsidies are increasing, despite the pledge the G-20 countries made in 2009 in Pittsburgh to remove them. Instead, according to IEA figures they have climbed from USD 342 billion in 2007 to 523 billion in 2011. Subsidies for renewables stood at 88 billion, 1/6 of the money put into fossil fuels.

Chile Doubles Renewable-Energy Goal to 20% to Spark New Projects. Bloomberg reports that Chile has doubled its renewable electricity goal to 20% of supply by 2025.

1.8 GW Of New Solar For Japan In Q2. CleanTechnica reports that Japan installed 1.8 GW of solar in the second quarter of the year, which is about twice as much as Germany installed.

Solar PV energy costs to undercut coal in South Africa. Londiwe Buthelezi reports that the cost of generating solar electricity in South Africa could fall substantially below the cost of coal-based generation by 2020. Doesn’t South Africa have some of the best coal resources in the world?

Wind at wholesale price parity in world’s major markets. Giles Parkinson notes that while solar is getting most of the attention, the economics of wind also continue to improve steadily. The levelised cost of energy of is not only cheaper than new fossil plants in many markets but also alreaddy competitive with existing wholesale electricity prices in a number of large markets, including China, the UK, Italy and Spain. In Brazil, wind is well beyond parity and by the far the cheapest in the country’s capacity auctions – so that a separate category was created for fossil fuels.

Germany blocks EU car emissions law. The Guardian reports that German pressure has lead EU ministers to reopen an already done deal on car CO2 emission standards. Since German carmakers like to built big and heavy cars, they want to water down what had already been agreed. Apart from the environmental impact less stringent efficiency requirements will also mean higher fuel bills for drivers.

Merkel Backs EU Carbon Fix in First Post-Election Speech. Another EU issue may perhaps get unblocked, though. Bloomberg reports that Merkel this week posited that, “We need a certain degree of backloading of CO2 emissions so certificate prices return to a sensible level.” Germany so far didn’t have a position on the EU ETS reform since the outgoing Liberal Democrat economy minister had been opposed.

German Renewables surcharge announced for 2014. A further increase of Germany’s renewables surcharge was announced this week. Craig Morris reports that German media and the public are nonetheless overall still calm about the cost of the energy transition. Most media reporting was balanced and highlighted that renewables were not the main driver of increasing retail prices, nor even the main driver of the surcharge increase.

Electricity cheaper than it’s been in a long time. Harald Schumann notes that while German retail power prices have increased strongly in recent years, wholesale prices are at a record low. The real eco-electricity scandal is in his view that the utilities are not passing those savings on to retail customers.